Help with accounting statements/balance sheet?

Question

For this accounting exercise I am given the data of assets, liabilities, revenues and expenses for a companies year of business. The info follows as:

Land 5,000
Note payable 6,000
Accounts payable 15,000
Rent expense 25,000
Cash 10,000
Common stock 30,000
Furniture 12,000
Interest expense 8,000
Property tax expense 2,000
Accounts receivable 11,000
Advertising expense 17,000
Building 115,000
Salary expense 60,000
Salary payable 1,500
Service revenue 240,000
Supplies 2,500

Beginning retained earnings were $10,000, and dividends totaled 75,000 for the year.

I'm then asked to make the income statement, statement of retained earnings & balance sheet for the company. Whenever I get to the balance sheet, it doesn't balance and I can't figure out what I'm doing wrong. Can someone give me an example by showing me what the correct statements look like? (This is not the problem in the book, I changed the numbers so as to not be cheating or w/e)

Answer 1

You are right. The balance sheet doesn't balance.

Here's the balance sheet:

Cash 10,000
Common stock 30,000
Accounts receivable 11,000
Supplies 2,500
Current Assets53,500

Building 115,000
Land 5,000
Furniture 12,000
Long Term Assets132,000

Total Assets185,500

Accounts payable 15,000
Salary payable 1,500
Current Liabilities16500

Note payable 6,000
Non-Current Liabilties6000

Owners' Equity (plug)163000< - off by 100,000

You are given assets and liabilities, but not owners' equity. You'll note that in order for the balance sheet to balance, you would need 163,000 in owners' equity... except that doesn't work because you start with 10,000 in owners' equity, you made 128,000 in profits, less 75,000 you paid in dividends means that owners' equity should rise by 53,000 for a total of 63,000. This does not equal 163,000. This means that you are off by 100,000. Either "building" is 100,000 too high (by accidentally adding the 1 in front of 15,000 or you forgot another 100,000 on the other side of the balance sheet (e.g. put a "1" in front of one of the liabilties).